Spencer Benefits Reports NetNews – August 7, 2015

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August 7, 2015

 

Confused about ACA reporting requirements? IRS explains what you need to know

The IRS has released a reminder that calculating the number of employees is especially important for employers that have close to 50 employees or whose work force fluctuates during the year. That’s because these applicable large employers, or ALEs, must offer their full-time employees and dependents affordable health coverage that provides minimum value. Here are some other reminders from the IRS for both ALEs and for employers with fewer than 50 employees…

(Read Intelliconnect) »

Health care spending will keep growing, but at a slower rate

After 30 years of total health care spending growth averaging 9 percent prior to 2008, the CMS Office of the Actuary expects an average growth rate of 5.8 percent from 2014 to 2024. The Actuary projected that health spending in the United States reached $3.1 trillion—$9,695 per person—in 2014, for a 5.5 percent increase from 2013. A large amount of the growth is attributable to prescription drug spending, which, at 12.6 percent, saw its largest increase since 2002, due in part to new expensive specialty drugs…

(Read Intelliconnect) »

August 6, 2015

 

Repeal of excise tax would benefit middle- and upper-middle income employees

If the Cadillac tax were repealed, the average tax cut would increase with income, with middle- and upper-middle income taxpayers would receive the largest share of the tax benefit, compared with the shares of after-tax income, according to a report by the Urban Institute and Brookings Institution’s Tax Policy Center. The report analyzes how the repeal would affect taxes independent of how the generosity of plans by wage level would change in the event of repeal…

(Read Intelliconnect) »

IRS announces curtailment of determination letter program for individually designed plans

The IRS has announced that it will make changes to the staggered five-year determination letter program due to a need to more efficiently use its limited resources. The IRS will eliminate the staggered five-year determination letter remedial amendment cycles for individually-designed plans and will limit the scope of the determination letter program for individually-designed plans to initial plan qualification and qualification upon plan termination. The IRS will provide a transition rule with respect to the remedial amendment period for certain plans currently on the five-year cycle. These changes to the determination letter filing procedures will be reflected in an update to IRS Rev. Proc. 2007-44 and in a successor to IRS Rev. Proc. 2015-6…

(Read Intelliconnect) »

Think tank’s five-point plan seeks to eradicate health reform law

Members of Congress should engage with each other and with the American people to develop an alternative to the Patient Protection and Affordable Care Act (ACA) and get it enacted into law, according to the National Center for Public Policy Research. The Washington D.C. conservative think tank is proposing a five-point plan to help with that goal, saying Congress needs to be more aggressive about repealing the ACA…

(Read Intelliconnect) »

August 5, 2015

 

ERISA doesn’t necessarily preempt state law bias claim based on LTD benefit plan

An employer and insurance carrier were unable to convince the First Circuit that ERISA preempted a state law claim of disability discrimination based on disparate disability benefits and thus also preempted a state administrative agency’s proceedings. Affirming the district court’s dismissal of their claim seeking a declaration that the administrative proceedings were barred, the appeals court found that abstention was proper since the civil enforcement proceedings resembled “criminal prosecutions in important respects,” the appellants had an adequate opportunity to raise their federal defense (preemption) in the state proceeding, and their preemption claim was not facially conclusive…

(Read Intelliconnect) »

 

Print benefits communications more likely to attract employees’ notice than electronic

More employees said that they want to learn about employee benefits options through printed materials at work (83 percent) or home (76 percent) than want to receive this information online (70 percent) or through email (61 percent), according to recent research from LIMRA…

(Read Intelliconnect) »

August 4, 2015

 

Text: IRS Notice 2015-52, Excise tax on high cost employer-sponsored health coverage

(Read Intelliconnect) »

IRS sets out additional approaches to excise tax on high cost plans, seeks comments

The IRS has issued a notice intended to continue the process of developing regulatory guidance regarding the excise tax on high-cost employer-sponsored health coverage under Code Sec. 4980I, which applies to tax years beginning after December 31, 2017. The new notice addressed additional issues, including the identification of the taxpayers who may be liable for the excise tax, employer aggregation, the allocation of the tax among the applicable taxpayers, and the payment of the applicable tax. The notice also addresses further issues regarding the cost of applicable coverage, and seeks comments…

(Read Intelliconnect) »

 

Health insurance issuers are well protected under the reinsurance umbrella

The transitional reinsurance program, which was first effective for the 2014 benefit year, collected more in payments than insurance issuers requested to compensate for above-threshold losses. As a result, CMS announced on July 27, 2015 that issuers will receive 100 percent coinsurance payments from the reinsurance program for their 2014 benefit year claims…

(Read Intelliconnect) »

Decedent’s sole beneficiary pays for “honorable” choice to share distribution with siblings

A taxpayer named as sole beneficiary of his late father’s IRA was liable for federal income tax due on the entire $96,000 distribution from the IRA, in spite of his “honorable” choice to share the distribution with his two siblings, the U.S. Tax Court (TC) has ruled in
Morris v. Commissioner. In addition, the court rejected as irrelevant the taxpayer’s contention that he was disadvantaged by erroneous advice from the law firm that assisted him in settling his father’s estate…

(Read Intelliconnect) »

August 3, 2015

 

IRS, SSA highlight employer reporting under ACA

The Patient Protection and Affordable Care Act (ACA) requires an applicable large employer (ALE) to offer its full-time employees and their dependents minimum essential coverage that is affordable and provides minimum value. To assist ALEs, the IRS and the Social Security Administration (SSA) have highlighted in the Summer 2015 edition of the SSA/IRS Reporter the employer reporting requirements under the ACA. The agencies reported that, while employers should already be tracking the data required to determine their status under the ACA and complete the new ACA reporting forms, they may not have determined whether the payroll, HR, or benefits department will be responsible for the filings. Regardless of which department ultimately completes the forms, they will have to coordinate the process as each of them may control the system housing some of the data to be reported…

(Read Intelliconnect) »

Majority of full-time workers had access to employer-provided medical care

Employer-provided medical care was available to 88 percent of full-time private industry workers in the United States in March 2015, according to the Bureau of Labor Statistics (BLS). By contrast, only 22 percent of part-time workers had medical care benefits available. Access, or availability, also varied by establishment size, noted the BLS: 58 percent for workers in small establishments (those with fewer than 100 employees), compared with 85 percent in medium and large establishments (those with 100 employees or more). These are among the findings of the report,
Employee Benefits in the United States—March 2015

(Read Intelliconnect) »

 

ERIC to CMS: Abandon HPID requirements

The ERISA Industry Committee (ERIC) has called on the Centers for Medicare and Medicaid Services (CMS) to eliminate requirements for health plan identifiers (HPIDs) for self-insured plans…

(Read Intelliconnect) »